RealTime IT News

Microsoft Looks to Stay EU's Hand

The European Court of First Instance is in the process of officially receiving a request from Microsoft to stay sanctions imposed in a March antitrust ruling.

According to news reports, Microsoft filed a request for a stay in enforcement of the penalties imposed by the European Commission.

The company filed a formal appeal of the ruling on June 8. This latest filing is the second part of the appeal process. It asks the Court to let Microsoft off from paying a $613 million fine and order to sever Media Player from Windows until its appeal is completed, a process that could take up to five years.

The EU established the Court of First Instance in 1989 to handle actions brought against the EU or its commissions, including requests for annulment of their rulings.

Microsoft spokesperson Jim Desler said he could not confirm that Microsoft had filed the request for a stay.

"I think the Court, in anticipation [of receipt of our filing], may have issued a release and then retracted it," he told internetnews.com. Representatives of the Court of First Instance in Brussels were not available for comment.

But Desler confirmed that Redmond will issue confirmation over the weekend or on Monday. "We will issue a statement confirming our filing once the Court has received our request," Desler said. "There is a European process we want to respect before issuing a formal statement."

Microsoft already filed its appeal of the Commission ruling to the Court of First Instance. "We made it clear that we intended all along to appeal the ruling," Desler said.

On March 24, the European Commission, the EU body charged with monitoring community issues including fair trade and competition, imposed a $613 million fine against Microsoft for anti-competitive behavior and abusing its market dominance. It also ordered the company to sell a version of Windows that does not include its Windows Media Player and to open its APIs to rival server software makers

The Commission gave Redmond 90 days to comply with the order. Microsoft appealed the ruling on June 8.

At the time of the appeal, Microsoft issued a statement saying, "The Commission's decision undermines the innovative efforts of successful companies, imposing significant new obligations on successful companies to license their proprietary technology to competitors, and restrict companies' ability to add innovative improvements to their products."

The Microsoft antitrust case is part of a broader initiative within the EU to ensure an unfettered industry. The Commission's stated position on competition is that, "Effective competition is crucial to an open market economy. It cuts prices, raises quality and expands customer choice. Competition allows technological innovation to flourish. For this to happen, businesses and governments must respect rules of fair play." The EU was particularly concerned that Microsoft could leverage its dominance in the PC OS market to other markets such as server software

"[The U.S. is] known to be the society that most believes in individual initiative and competitiveness. That's reflected in our antitrust principles," said Robert Badal, a partner in the law firm Heller Ehrman White & McAuliffe. "The EU takes more of a social democratic, state-driven approach to things. They have a much broader definition in their social policies of what's good for the body public, and it's reflected in their antitrust laws."

The decision illustrates the growing tension between patent and antitrust law. According to Badal, while both are designed to encourage innovation and progress, the patent system seeks to promote creation and innovation by granting monopoly-like rights; antitrust law does so by encouraging aggressive competition and eliminating monopoly power. However, as the scope of IP rights grows, so does the risk to companies of falling afoul of antitrust regulators.